To be consistent with international standards,the FASB has changed reporting requirements for redeemable preferred stock to require it to be reported in the equity section.

Question

Quizplus · Accepted Answer

The FASB requires redeemable preferred stock to be reported as a liability, not in the equity section, to reflect the company's obligation to repurchase the stock in the future. This approach may differ from international standards, which can allow for such instruments to be classified as equity under certain conditions.

To Be Consistent with International Standards,the FASB Has Changed Reporting